SCOTUS Issues a TILA Recission Decision

Under the Truth in Lending Act, borrowers may unconditionally rescind a loan with three days following the [later of] the consummation of the transaction or the delivery of TILA disclosures.  A borrower may further rescind for up to three years if the lender fails to satisfy the disclosure requirements of TILA.
At question in the case of Jesinoski v. Countrywide Home Loans, Inc. was whether recission was valid only by the filing of a lawsuit, or if written notice would suffice.  The U.S. Supreme Court held that only written notice was required.

Foreclosure Alternatives

Barring new legislation (HFSTHA having died in the Senate about a year ago), Chapter 13 Bankruptcy will not allow you to modify the terms of the mortgage note, though it still remains an excellent option for curing arrearage and stopping foreclosure. The automatic stay that accompanies a bankruptcy filing puts the brakes on foreclosure proceedings, and debtors are permitted to cure the mortgage arrears over the life of a 3-5 year plan (and in the Eastern District of Wisconsin, do so at 0% interest).
Other options you might want to consider to deal with bad mortgages:
Consider whether the house is truly worth keeping. Even if you are successful in negotiating with a mortgage company to restructure, refinance, or improve the terms of the loan – a victory isn’t a victory if you can’t afford the new terms. Do a reality check, and be willing to walk away from the home when it is impractical for you to keep up payments. Speak to a budget counselor if necessary.
Wisconsin homeowners should contact WHEDA ( for referral to non-profit agencies who can help you negotiate your loans. If you run into a dead-end, also try the Department of Housing and Urban Development (
Make a qualified written request under RESPA (many consumer attorneys can assist with this) to obtain full loan history information with all payments and escrow payments. You might also ask to find out who the current holder and owner of the mortgage lien and the note. Be advised that the loan and the lien securing the house are two separate items. Be sure you are able to distinguish between the mortgage broker, the mortgage originator, mortgage holder, note holder, and mortgage servicer. These are rarely the same entity, and often change hands over time.
If you have been served with a summons, ensure that the plaintiff actually owns the note and mortgage. If they do not, they might not have standing to bring the foreclosure action.
Have an attorney who specializes in foreclosure defense work analyze your mortgage, note, closing statement (HUD-1), Notice of Right to Cancel, and Truth in Lending Statement for TILA violations.
Other laws that COULD be of use: Home Ownership and Protection Act (HOEPA), Real Estate Settlement Procedures Act (RESPA), Fair Debt Collections and Practices Act (FDCPA), common-law fraud, common-law misrepresentation, common-law unconscionability, and common-law negligence.